These minutes are in
compliance with Senate and House Rules.Only text enclosed in quotation marks reports a speaker’s exact
words.For complete contents,
please refer to the tapes.

TAPE/#

Speaker

Comments

TAPE 3, A

004

Chair Hannon

Calls the meeting to order
at 5:55 p.m.Opens a public hearing
onHB 4073-A.

HB 4073-A PUBLIC HEARING

008

Richard Yates

Legislative Revenue
Office.Provides materials (EXHIBIT A) and a brief explanation
of HB 4073-A.States that the measure
raises $400 million in revenues for the State School Fund through
bonding.Describes how the bonds will
be sold off and how they are to be repaid.Mentions that Treasury estimates that 77 percent of the Master
Settlement revenue will be used to pay off the bonds.

044

Sen. Courtney

Asks if the corporation set
up to administer the bonds will be similar to the State Accident Insurance
Fund (SAIF).

050

Yates

Responds that the corporation
is meant to be a public corporation, as opposed to a state agency, similar to
the model used by other states for Master Settlement Agreement payment monies.

058

Chair Hannon

Asks how the bonds will be
repaid if revenue decreases and the state is incapable of paying for them.

063

Yates

Explains that in such a
situation the debt would belong to the corporation, rather than the state,
adding that if the Master Settlement Agreement payments were stopped the bond
holder will not be paid. Acknowledges that it might also take longer to pay
off the bonds.

075

Sen. Courtney

Notes that the Oregon
Supreme Court will determine the validity of the sections of the act in the
event that of a challenge and asks whether such a challenge is anticipated.

083

Yates

Interprets the language to
be designed to prevent a challenge to the system once it is already in place.

098

Kate Richardson

Oregon State
Treasury.Explains that the language
in the measure is modeled after similar measures in other states, and is
designed to provide a swift resolution in the event of a legal challenge. Clarifies that such a challenge is not
anticipated.

108

Sen. Courtney

Inquires whether such a challenge
could be made on the basis of the funds being used in a way different than
that for which the settlement was designed.

111

Richardson

Answers that there are no
such restrictions, adding that the stipulation is meant to respond to a
challenge by bondholders.

115

Sen. Courtney

Asks whether there is
doubt about the constitutionality of the measure.

118

Richardson

Replies she is unsure.

122

Sen. Dukes

Notes that the measure
calls for the $400 million to be directed into the State School Fund, from
which they are subsequently retrieved for use in the General Fund. Asks
whether the funds are moved in such a manner because of restrictions as to
how the funds are to be used.

130

Yates

Clarifies that the funds
should retain their exempt status so long as the word ‘grant’ remains.

147

Sen. Courtney

Asks again what sort of
legal challenge could be made against the measure.

152

Harrison Conley

Legislative Counsel
Office.Explains that the language
was taken from model legislation, and that the reference to the Supreme Court
was included not because a particular challenge is anticipated, but because
it was language borrowed from model legislation.

161

Sen. Dukes

Wonders who would have the
right to take a challenge to the Supreme Court.

163

Conley

Replies that anyone with a
constitutional problem with the measure could do so.

169

Sen. Dukes

Asks again whether there
are any known constitutional problems with the measure.

170

Conley

Replies he is unaware of
any such problems with HB 4073-A.

181

Chair Hannon

Closes the public hearing
on HB 4073-A and opens a public hearing on HB 4074-B.

Closes the public hearing
on HB 4074-B and opens a public hearing on HB 5100-A.

HB 5100-A PUBLIC HEARING

333

Ken Rocco

Legislative Fiscal
Officer.Distributes materials (EXHIBIT C) and provides a brief
explanation of the provisions of HB 5100-A.Indicates that the measure outlines disappropriations for the Fifth
Special Legislative Session.Explains
that the measure, in concordance with HB 4074-B and HB 4073-A, will
effectively rebalance the budget.

379

Grattan Kerans

Director of Government
Relations, Oregon University System.Testifies in opposition to HB 5100-A (EXHIBIT D).Describes
the effect the measure would have on higher education in Oregon.

TAPE 4, A

015

Chair Hannon

Acknowledges that the
measure implements additional reductions on higher education.

024

Mark Nelson

Association of Oregon
Faculties, Oregon Head Start Association, Oregon Judges Association,
Independent Living Centers.Testifies
that many of the organizations he represents are opposed to the reductions
within HB 5100-A.Mentions that Oregon
Head Start Preschool would be forced to reduce the percentage of eligible
children served from 50 percent to 42 percent.Asserts that Head Start is the foundation for education in Oregon
and should therefore be restored and protected.

043

Bill Lippman

Oregon Judges
Association.Testifies in opposition
to the cuts outlined in HB 5100-A.Recalls
previous cuts made during earlier special sessions, the effects of which have
been moderated somewhat due to drops in caseloads.Indicates that the Indigent Defense Fund will run out of money
in April, resulting in significant effects throughout the criminal justice
system.

070

Nelson

Notes that the independent
living centers are also on the list of services being cut.

088

Sen. Dukes

Asks about funding shifts
related to the National Marine Fisheries Service (NMFS).

090

Rocco

Replies that provision is
not included in the A-engrossed version of HB 5100. Explains which items are
included.Explains how spending has
shifted to account for NMFS.

107

Vice-Chair Messerle

Closes the public hearing
on HB 5100-A and opens a work session on HB 4074-B.

HB 4074-B WORK SESSION

100

President Derfler

MOTION:Moves HB 4074-B to the floor with a DO
PASS recommendation.

114

Sen. Dukes

Expresses opposition to
the motion.

127

Sen. Courtney

Indicates he will also
vote no on the motion.Says that
while he has supported budget cut measures he cannot support the level of
cuts in HB 5100-A.

133

VOTE:3-2-1

AYE:3 – Derfler, Harper, Messerle

NAY:2 - Courtney, Dukes

EXCUSED:1 – Hannon

Vice-Chair
Messerle

The motion
CARRIES.

136

Vice-Chair Messerle

Closes the work session on
HB 4074-B and opens a work session on HB 5100-A.

HB 5100-A WORK SESSION

142

President Derfler

MOTION:Moves HB 5100-A to
the floor with a DO PASS recommendation.

146

Rocco

Submits a budget note (EXHIBIT E) for HB 5100-A.

172

Sen. Dukes

Asks who drafted the budget
note.

175

Rocco

Explains that the budget
note was developed earlier in the day in concordance with several measures.

179

Sen. Dukes

Wonders why some agencies
are allowed access to Emergency Board funds through the budget note while
others are not.Notes that there was
no opportunity for public testimony on the budget note.Expresses opposition to the budget note.

195

Vice-Chair Messerle

Notes Sen. Dukes’
opposition to the insertion of the budget note.

207

VOTE:3-2-1

AYE:3 – Derfler, Harper, Messerle

NAY:2 - Courtney, Dukes

EXCUSED:1 – Hannon

Vice-Chair
Messerle

The motion
CARRIES.

209

Vice-Chair Messerle

Closes the work session on
HB 5100-A and opens a work session on HB 4073-A.